Fuel fraud quietly drains trucking profits through stolen fuel, misuse of fuel cards, and falsified transactions. With fuel being one of the largest operating expenses for carriers, even small amounts of fraud can add up fast, especially without proper controls and visibility.
This guide explains what fuel fraud is, how it happens, and how carriers can prevent it, including how technology from OTR Solutions helps reduce risk.
Key takeaways
- Fuel fraud in trucking takes many forms – including internal misuse, external criminal activity, and coordinated collusion schemes
- Fuel card fraud is a common subset of fuel fraud – often involving stolen cards, compromised PINs, or unauthorized purchases
- Fraud is typically detected through usage patterns – such as fuel volumes exceeding tank capacity, route mismatches, or inconsistent mileage
- Transaction controls and monitoring reduce risk – by limiting when, where, and how fuel cards can be used
- Fuel card reporting improves visibility – helping carriers identify abnormal spending behavior and potential misuse
What is fuel fraud?
Fuel fraud is the unauthorized use, theft, or manipulation of fuel purchases, often involving company fuel cards, to gain personal or financial benefit. Drivers, outside criminals, or coordinated schemes with third parties can commit it.
Fuel fraud increases operating costs, complicates accounting, and exposes carriers to compliance and security risks.
What is fuel card fraud?
Fuel card fraud is a subset of fuel fraud involving the misuse or theft of fuel card credentials. This includes stolen card numbers, compromised PINs, or drivers using company cards for non-approved purchases or vehicles.
Types of fuel fraud in trucking
Fraud schemes targeting fuel expenses take multiple forms, from internal misuse to coordinated criminal activity. Each type requires different prevention strategies.
Internal fuel fraud (employee-driven)
These schemes originate within a fleet or driver operation. Owner-operators and small businesses using fuel cards are particularly vulnerable without proper controls in place.
- Side fueling/slippage: Fueling personal vehicles or containers using a company card
- Unauthorized purchases: Buying non-fuel items like food or cigarettes
- Mileage creeping: Inflating mileage to justify excess fuel use
- Off-route fueling: Purchasing fuel outside assigned routes or schedules
External fuel fraud (criminal activity)
Fraud committed by third parties targeting fuel cards and pumps. Effective fleet and fuel management practices help identify these threats early.
- Card skimming: Devices installed on pumps to steal card data and PINs. The FBI warns that skimming occurs when devices illegally installed on ATMs, point-of-sale (POS) terminals, or fuel pumps capture data or record cardholders' PINs.
- Card-not-present fraud: Using stolen card details online or over the phone
- Phishing attacks: Tricking drivers or admins into revealing card credentials
Collusion and systemic fuel fraud
More organized schemes involving multiple parties.
- Phantom fill-ups: Fuel charges that never actually occur
- False or duplicate transactions: Stations charging multiple times for one purchase
- Employee–station collusion: Coordinated fraud between drivers and attendants
How fuel fraud is detected
Fuel fraud is typically identified through patterns and inconsistencies over time, rather than a single suspicious transaction. Carriers and fuel management systems look for behavior that doesn't align with normal driving routes, vehicle capacity, or historical fuel usage.
Common red flags include:
- Multiple fuel purchases in short timeframes – especially at different locations
- Fuel volumes that exceed a truck's tank capacity – signaling side fueling or phantom fill-ups
- Transactions outside assigned routes, regions, or operating hours – indicating off-route purchases
- Fuel usage that doesn't match reported mileage or expected MPG – suggesting inflated consumption claims
- Repeated manual overrides or declined PIN attempts – which may indicate card misuse or compromise
Early detection of these red flags allows carriers to investigate quickly, freeze cards if needed, and prevent small issues from turning into major financial losses.
Fuel fraud reporting and compliance
Fuel card fraud isn't just a business problem; it's increasingly a regulatory concern. According to Texas House Bill 201, certain entities must now include in their annual reports a summary of card fraud and motor fuel theft, if applicable.
Carriers should maintain detailed records of suspected fraud incidents, not only to protect their operations but also to ensure compliance with evolving reporting requirements.
How to prevent fuel fraud in trucking
Strong controls and smart technology make fraud harder to commit and easier to catch. These practices help carriers improve visibility into fuel spending and reduce fraud risk.
1. Enforce clear fuel card policies
Establish written policies that define acceptable fuel card use and driver responsibilities. Clear guidelines reduce confusion and make violations easier to identify.
- Define approved vehicles, locations, and products
- Require driver accountability and documentation
- Communicate policies during onboarding and training
2. Use transaction controls
Modern fuel cards let you set spending limits and restrictions that automatically block unauthorized purchases. These controls work 24/7 without manual oversight, reducing fuel card fraud risk and protecting your operation from misuse.
- Daily and per-transaction spending limits
- Merchant and product restrictions
- Time-of-day fueling rules
- Fuel-type restrictions (diesel-only or vehicle-specific fuel rules)
3. Monitor fuel activity in real time
Real-time monitoring catches fraud as it happens, not weeks later during expense reviews. Mobile apps and online portals provide live transaction data that helps you spot suspicious activity immediately.
- Alerts for suspicious transactions
- Immediate card shutdown when fraud is suspected
- View purchases as they occur
4. Audit fuel usage regularly
Regular audits reveal patterns that automated systems might miss. Weekly and monthly reviews help you identify trends and address problems before they escalate.
- Match receipts with mileage and vehicle specs
- Review weekly and monthly fuel reports
- Compare fuel efficiency across drivers and routes
- Investigate unusual spending patterns
5. Use secure fuel card technology
Card security features create barriers that stop most fraud attempts. Strong technology protects your operation from unauthorized use.
- PIN protection
- Secure transaction processing
- Driver-specific cards with unique identifiers
How OTR Solutions helps carriers fight fuel fraud
The OTR Fuel Card is designed to give carriers visibility, control, and flexibility over fuel spending.
Key advantages include:
- Transaction-level monitoring to spot fraud early
- Custom gallon limits and fuel-only restrictions
- Simplified reporting to identify misuse patterns
- Fuel credit access to help manage cashflow while maintaining security
- Fuel Finder technology that helps you locate fuel savings across your routes
Frequently asked questions
What is the most common type of fuel fraud?
Internal fraud, such as side fueling and unauthorized purchases, is the most common due to limited oversight without controls. Carriers with proper spending restrictions and monitoring can reduce these risks significantly.
How do criminals steal fuel card information?
Through card skimming devices, phishing scams, or data breaches at compromised fuel stations. Strong security features and proper fleet fuel management help protect against these threats.
Can fuel fraud be completely prevented?
Fuel fraud can’t be eliminated entirely, but strong controls, active monitoring, and secure fuel card programs significantly reduce both risk and financial loss.
Are fuel cards safer than credit cards?
Fuel cards are safer than personal credit cards when they include PIN protection, transaction controls, and real-time alerts, making fraud easier to detect and stop.
Protect your fuel spend before fraud costs you
Fuel fraud cuts into profits, creates compliance headaches, and slows operations. The right systems make fraud harder to commit and easier to catch.
Learn how the OTR Fuel Card helps carriers control fuel costs, reduce fraud risk, and access fuel credit, without adding complexity. Get started today to protect your fuel spend and keep more money in your operation.
